From 1200-1500 CE the Mongol rule spread, dominating large regions of land, and through violent conquering initiated economic and political effects throughout Eurasia. Both the Yuan and the Il-Khan were militaristic and conquered land, which led to a tribute-based economy. The Yuan maintained a stable bureaucracy, whereas the Il-Khan had many economic troubles.
The two khanates were developed upon similar economic and political foundations. Both lived as pastoral nomadic peoples. The constant movement kept them from developing a central government, however, it allowed for widespread conquering that led to cultural diffusion, initiating a flourishing trade-based economy under Mongol rule. Due to this new advance and dependence on trade, the Mongols developed a passport system. Regulation of travel facilitated movement of products and merchants and increased economic benefits for the Mongols as well as neighboring regions. Tribute was collected from defeated peoples, taking form in goods and labor was a major basis of the economy and increased political power/influence. Rulers would collect tribute in turn for protection, a never-ending cycle that continually supported Mongol rulers, solidifying resources and leading to intergroup alliances that supported developing Mongol rule. Tax farming in Muslim territory under Mongol rule led to economic downfall. Decreased agricultural productivity forced government seizing of land, but exemption from taxation on government property shrank the tax base, creating a permanent state of economic downfall. In both khanates the use of paper money had detrimental effects on economic stability. Printing paper money caused irreparable inflation and led to the economic demise of both the Il Khan and the Yuan.
There were differences in the Yuan and Il-Khan economy and government.
The Yuan had many religions, therefore did not emphasize a single state religion and incorporate it into their politics or economy. However, the Il-Khan converted to Islam, which caused a strain on their economy because Ghazan decreased taxes in respect for Islam’s values, although he needed the revenue. The Yuan was a more stable government and economy than the Il-Khan. They had a social structure, each group with a different job, whereas Il-Khan’s Islam would have seen this as unequal. The Yuan also divided itself into provinces and had provincial governors, and the Il-Khan did not. Both experienced the failure of paper money, but Yuan introduced copper coinage, which was more successful. The Yuan and Il-Khan handled the native people differently. The Yuan did not allow the Chinese to have any power, causing isolation between the peoples, and the Il-Khan allowed the Persians to have at least some power, meaning more cohesion between those under conquest and conquerors.
Under Mongol rule of the Il-Khan and the Yuan, trade in Eurasia flourished, allowing for widespread economic growth, but was shown to be short-lived, as through the introduction of new systems, economic downturn became irreversible. Differing religious and social fundamentals of the khanates proved to have varying political and economic effects.
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